What is the current status of the once-booming Metaverse?

Author: Zen, PANews

The “Metaverse,” which was repeatedly hyped two or three years ago, has become clearer in its true industry landscape as the narrative wave recedes. Approaching the end of 2025, the global metaverse industry presents a complex picture of “hot and cold” uneven development.

After the boom in 2021 and cooling in 2022, the metaverse ecosystem in 2025 has not experienced an overall decline; instead, some sectors show signs of recovery and breakthroughs.

At the same time, some areas still struggle to grow, forming a stark contrast. Some have set new records in user scale and engagement, while others face declining activity or user attrition. This polarization has become a key observation point for the metaverse industry in 2025.

Immersive Gaming Platforms: Over 100 Million Users but Need to “Tear Off” the Metaverse Label

The virtual worlds provided by immersive games are currently the most mature and active sector of the metaverse. In 2025, immersive UGC gaming platforms continued to grow, with leading platforms performing remarkably.

Among them, Roblox, as an industry bellwether, reached new highs in user scale and revenue: in Q3 2025, Roblox’s average daily active users reached 151.5 million, a 70% increase year-over-year, and quarterly revenue grew 48% YoY to $1.36 billion. Its massive user base indicates that the UGC metaverse model combining gaming and social features remains highly sticky and attractive.

However, Roblox’s official statements do not emphasize the concept or narrative of the metaverse; it only referenced its vision during the peak hype in 2021. Now, Roblox prefers to tell its story within frameworks like “global gaming market,” “platform and creator ecosystem,” and “virtual economy,” without prominently featuring the “metaverse” label.

In contrast, Epic Games, the developer behind Fortnite, which also has over 100 million monthly active users, still regards its platform as a key gateway to an open metaverse and interoperable digital ecosystem. In November 2025, Epic announced a partnership with the cross-platform game engine Unity. CEO Tim Sweeney stated that companies need to collaborate like in the early days of the internet to build an open metaverse in an interoperable and fair manner. Sweeney revealed that 40% of Fortnite’s gameplay time occurs in third-party content, i.e., the “metaverse” part.

Fortnite’s music festivals are original gaming experiences centered on music and rhythm. This year, it partnered with Hatsune Miku, Sabrina Carpenter (“Craftsman”), Bruno Mars (“Mars Guy”), and BLACKPINK’s Lisa to bring virtual large-scale music festivals to millions of players and fans. Additionally, Roblox collaborated with Icelandic-Chinese mixed-race musician Laufey and K-pop girl group aespa to perform at its official music venue “The Block.” These events demonstrate that immersive platforms still have potential to become new “digital third spaces,” supporting new forms of entertainment and social interaction.

Besides these giants, Minecraft has long been considered part of the metaverse gaming ecosystem. However, this platform rarely brands itself as a metaverse ecosystem; its core strategy focuses on community and creation. More critically, support for immersive hardware like VR and MR in Minecraft has ended this year. The official Bedrock update notes that support for VR/MR devices will cease after March 2025, and after the final update, players can only continue playing in non-VR/MR modes.

Overall, in 2025, immersive gaming platforms remain “the strong get stronger”: top platforms like Roblox continue expanding their user base with large ecosystems and creator communities, while small and medium platforms face declining user activity or risk being acquired or phased out. The reduced promotion and strategic abandonment of the metaverse concept by leading ecosystems have significantly weakened the public’s awareness of the metaverse.

Metaverse Social: Old Decline, New Opportunities Await

Compared to immersive gaming, metaverse-style virtual social platforms in 2025 show little remarkable progress, mostly reflecting on their past and exploring new directions. Some early movers have become dormant, while others struggle to transform.

As a flagship platform, Meta has gradually adjusted its strategy in 2023-2024, moving away from isolated VR social applications and attempting to connect its metaverse social products with existing platforms like Facebook and Instagram, which have massive user bases.

However, Horizon Worlds under Meta has struggled, with fewer than 200,000 monthly active users, a tiny fraction compared to hundreds of millions of Facebook users. By late 2024, Meta began opening Horizon Worlds to mobile and web to lower barriers and expand the user base, claiming a fourfold increase in mobile users within a year. Yet, as a platform primarily relying on VR devices, Horizon’s user adoption remains limited and far from explosive growth.

Meta’s CTO admitted at Connect 2025 that the company needs to demonstrate that metaverse social can retain enough users and generate profitable models; otherwise, huge investments will be hard to sustain. To this end, Meta is adding AI-generated content and NPCs to enrich Horizon, and emphasizing integration with real-world social networks to reduce user acquisition costs.

Other new virtual social and entertainment platforms show a “fire and ice” situation. The veteran VR social platform VRChat maintained steady growth driven by its core community, with a record high in 2025: during New Year’s 2025, peak concurrent online users exceeded 130,000, reflecting its vitality as an open community platform. Additionally, user-generated content in markets like Japan drove VRChat’s user growth over 30% between 2024 and 2025.

In contrast, Rec Room, once valued at $3.5 billion, faced growth bottlenecks and announced layoffs of over half in August 2025. Early on, Rec Room was favored by capital for its cross-platform UGC gameplay and creator economy, but as it expanded into mobile and consoles, a flood of low-quality content emerged, and the high-quality creation ecosystem failed to keep pace, leading to lower user retention and revenue than expected. Co-founder admitted that mobile and console users find it hard to create engaging content, and efforts like AI creation tools have not yet paid off.

2025 also saw exploration of new virtual social spaces. For example, AI technology began to be used to enhance social experiences—introducing AI-driven virtual companions in VR chat rooms, or generating personalized virtual spaces with GPT models. These innovations are still experimental but point toward future directions: smarter environments, emotionally interactive virtual characters, and closer integration with real-world content.

Overall, 2025’s metaverse social scene is in a low tide adjustment phase. The novelty of pure virtual social experiences has waned, and demand is becoming rational: without high-quality content and real social value, users won’t stay long. This is evident in the situations of Horizon and Rec Room. Industry practitioners now understand that future efforts should focus on improving content quality and community culture, and finding clever ways to integrate with real-world social interactions.

Hardware and Spatial Computing: AR Glasses Rise, VR Under Pressure to Transform

2024 is regarded as the “Year of Spatial Computing” by the industry, with several major XR (Extended Reality) hardware launches or breakthroughs reigniting the sector.

The most notable in the first half was Apple’s Vision Pro—this high-end mixed reality headset was launched in limited quantities in the US in early 2024 and gradually expanded to more regions in 2025. Priced at $3,499 and with limited production capacity, Vision Pro’s sales are modest. Apple CEO Tim Cook admitted that Vision Pro is “not a product for the mass market” and mainly appeals to early adopters and tech enthusiasts. Nonetheless, Apple continued investing in ecosystem development in 2025: releasing updates to visionOS and rumors of an upgraded hardware version with improved M-series chips and a redesigned headband.

Beyond the high-end market, Meta’s Quest series remains dominant in mainstream VR. The Quest 3, released at the end of 2023, continued to sell well through 2024-2025 holidays thanks to improved performance and comfort. According to IDC, Meta held about 60.6% of the global AR/VR headset + smart glasses market in the first half of 2025, far ahead of competitors.

Sony’s PlayStation VR2, launched in early 2023, experienced significant price cuts and repositioning in 2025. With only a few million units sold in its first year—below expectations—Sony reduced the official price by about $150-200 starting March 2025, bringing it down to $399.99, aiming to boost sales with a more affordable price. The price cut led to a sales boost during the holiday season, and the cumulative sales are expected to approach 3 million units by the end of 2025. However, compared to Quest’s wireless portability, PS VR2 remains limited by its console platform, with a content ecosystem mainly targeting core PlayStation users.

Another highlight in 2025 is the rise of consumer-grade smart glasses. Meta’s second-generation Ray-Ban Meta smart glasses, launched this year, introduced integrated displays and basic AR functions. These “lightweight AR glasses” without full immersive displays saw a surge in shipments. IDC reports that global AR/VR headset + smart glasses shipments are expected to reach 14.3 million units in 2025, up 39.2% year-over-year.

Meta’s Ray-Ban models, with their appearance similar to ordinary sunglasses and practical features like photo-taking and AI, are popular among urban young users. Overall, the XR hardware market in 2025 shows a “polarized” pattern: ultra-high-end Vision Pro sparks innovation but with limited sales; mid- and low-end Quest and smart glasses dominate volume; traditional PC VR, expensive HoloLens 2, Magic Leap 2, and other enterprise AR devices have relatively modest influence, mainly used in industry.

At Meta’s Connect 2025, the company emphasized integrating generative AI into XR, enabling users to generate virtual scenes and objects via voice. Apple is also exploring combining Vision Pro with AI assistants and more natural human-computer interaction. This indicates that AI+XR will become a new investment hotspot in 2026. Additionally, industry collaboration and standards are accelerating: OpenXR support is expanding across brands, with increasing compatibility in content and accessories, and companies like Microsoft and Valve are preparing new devices.

Notably, XR hardware applications outside the industry are also expanding: in 2025, solutions for healthcare and education saw significant growth, with more hospitals adopting VR therapy (e.g., RelieVRx) and schools using AR for teaching, demonstrating XR’s value and paving the way for long-term adoption.

Digital Humans and Virtual Avatars: Tech Upgrades and Commercialization

In 2025, digital identities and virtual humans (avatars) in the metaverse continued to develop, with many companies worldwide offering creation and management services. Notable examples include Korea’s NAVER Z’s ZEPETO and European startup Ready Player Me (RPM).

By 2025, ZEPETO had over 400 million registered users, with about 20 million active monthly. While not as large as Roblox or Fortnite, it is significant within vertical metaverse communities. ZEPETO’s user base mainly consists of Gen Z, especially females, who create personalized 3D avatars, wear virtual fashion, and socialize or take photos in various in-app scenes.

In 2025, ZEPETO continued attracting fashion and entertainment brands, including collaborations with luxury brands like Gucci and Dior for limited digital apparel, and virtual fan meetings with K-pop idols. These activities boosted platform engagement and helped stabilize its user base post-pandemic. NAVER Z reports that its overall product line—including ZEPETO and sticker tools—has about 49.4 million monthly active users, maintaining growth in 2025.

Ready Player Me, as a cross-platform avatar creation tool, was acquired by Netflix at the end of 2025, attracting industry attention. Since its founding in 2020, RPM has raised about $72 million from investors including a16z. It allows users to create versatile 3D avatars compatible across multiple virtual worlds. Before acquisition, over 6,500 developers adopted its SDK, supporting RPM avatars in various products.

Post-acquisition, Netflix plans to leverage RPM’s team and technology to expand its gaming business, enabling users to have unified virtual identities across games. RPM also announced it will shut down its public standalone avatar service in early 2026 to focus on internal integration.

Meanwhile, Snapchat, with over 300 million daily active users, is exploring further metaverse features for Bitmoji, such as testing generative AI for virtual avatars and launching Bitmoji fashion stores. Bitmoji allows users to create cartoon avatars of themselves and use them as stickers. Most Snapchat users use Bitmoji for customization.

Meta is also investing in its own avatar ecosystem: in 2025, Meta introduced more realistic “Codec Avatars” in Quest and social apps, allowing cross-platform use across Facebook, Instagram, and Quest. It also launched AI virtual characters endorsed by celebrities in Messenger, aiming to build a comprehensive digital identity system across its social and VR platforms.

( Industrial Metaverse: Most Practical, Accelerating Value Realization

Compared to consumer-facing products like games and VR glasses, the industrial and enterprise metaverse in 2025 has become the most practically meaningful and growth-potential sector. After initial hype, manufacturing, engineering, construction, and medical training industries have become early adopters of industrial metaverse technology. Market research indicates that the industrial metaverse market reached approximately $48.2 billion in 2025, with an expected CAGR of 20.5% from 2025 to 2032, reaching around $600 billion by 2032.

A typical example is NVIDIA’s Omniverse platform, widely used by large enterprises for digital twins and simulation in 2025. Reports show that automakers like Toyota, TSMC, and Foxconn are using Omniverse to build factory digital twins for optimizing production lines and AI training. The ecosystem’s extensive collaborations include deep integrations with industrial software companies like Ansys, Siemens, and Cadence, standardizing data and visualization.

Traditional industrial software firms like Siemens are actively promoting the industrial metaverse concept in 2025. A survey by Siemens and S&P Global found that 81% of global enterprises are already using, testing, or planning to implement industrial metaverse solutions, reflecting high industry focus on digital twins, IoT+AI, and immersive training.

Specific cases include BMW expanding its virtual factory project, reducing new model ramp-up time by 30% through digital twin simulations; Boeing using HoloLens and digital twins to design complex aircraft parts, claiming a nearly 40% reduction in design errors. In healthcare and training, VR/AR applications are maturing: several US hospitals adopted VR therapies (e.g., RelieVRx) in 2025, with 84% of medical professionals believing AR/VR will positively impact the industry.

Additionally, multinational energy companies use VR for hazardous condition training, logistics firms employ AR glasses for warehouse picking, achieving good ROI. For example, a French nuclear power company reported a >20% reduction in new employee accident rates through VR training. Some government-led digital twin projects, like Singapore’s upgrade of national 3D models and Saudi Arabia’s mega-scale metaverse sandbox for NEOM, are also practical results of industrial metaverse development.

Thus, the industrial metaverse has largely moved beyond hype, becoming a natural extension of digital transformation. However, challenges remain: incompatible solutions from different vendors, data silos, and security concerns hinder widespread adoption. Connecting production systems and cloud simulations involves data security and confidentiality issues, requiring time to resolve. Despite high application rates, many projects are still at PoC (proof of concept) or small-scale stages, far from full industry-wide adoption.

) Cryptocurrency, NFT Metaverse: Heavy Historical Burdens, Difficult to Rebound

After the bubble burst in 2022-2023, speculative hype around NFT virtual land and blockchain games subsided. However, the “core players” in this track have not given up; new projects and technologies are injecting fresh vitality. Established decentralized virtual worlds like Decentraland and The Sandbox continue to operate, but their active users and peak activity are nowhere near previous highs.

DappRadar data shows that in Q3 2025, total NFT transaction volume across metaverse projects was about $17 million, with Decentraland’s quarterly land sales only $41,600 and 1,113 transactions. Compared to the peak in 2021 when land sales reached millions of dollars per transaction, this is a huge decline. User activity also declined: as early as 2022, DappRadar reported Decentraland’s daily active users below 1,000, with only a few hundred to a few thousand online daily, and only major events attracting tens of thousands.

This “ghost town” phenomenon also exists in The Sandbox and other platforms. However, project teams try to maintain communities through DAOs and events: Decentraland established a metaverse content fund in 2025, with an $8.2 million DAO grant supporting Art Week, Career Fair, and other activities to attract creators and enterprises. The Sandbox partnered with Universal Pictures to launch themed virtual zones like “The Walking Dead” IP, attempting to attract new users.

The biggest event in the crypto metaverse in 2025 was the launch of Yuga Labs’ Otherside. As the company behind Bored Ape Yacht Club (BAYC), Yuga prepared for three years and officially launched the Otherside virtual world in November 2025, accessible via web without requiring NFTs. On launch day, tens of thousands of players flooded into the new “Koda Nexus” area, creating a rare high-profile moment for Web3 metaverse popularity. Yuga also integrated AI world-generation tools into Otherside, allowing users to create 3D game scenes via dialogue, enriching user-generated content.

Compared to other metaverse paths, ecosystems integrated with cryptocurrencies and NFTs carry heavier historical baggage. During the previous peak, excessive financialization and speculative narratives dominated product promotion and user expectations, ultimately causing many participants to suffer significant financial losses.

As a result, the NFT-based metaverse ecosystem faces greater trust issues among the public. This track is difficult to escape stereotypes of “asset speculation,” “disconnect from real needs,” and “poor experience.” Although some teams are trying to refocus on content and experience, in the short term, it’s nearly impossible to shake the neglect and distrust from mainstream users, making widespread adoption a distant goal.